TIDMSOLG
RNS Number : 1512P
SolGold PLC
29 August 2017
29 August 2017
SolGold plc
("SolGold" or the "Company")
New Concessions Granted for 100% SolGold Ecuador
Subsidiaries
The Board of SolGold (AIM code: SOLG) is pleased to provide an
update on its four new 100% owned subsidiary companies in Ecuador
and 21 new concessions granted in Ecuador.
Highlights:
Ø SolGold's 100% owned subsidiaries now have a total of 59
tenements granted in Ecuador totalling 2,496 km(2) .
Ø Field mapping has identified multiple targets with strong
alteration and mineralisation.
Ø Following encouraging initial results, 2nd phase soil sampling
programs are being planned.
References to figures and tables relate to the version of this
release on the Company's website (www.solgold.com.au) or visible in
PDF format by clicking the link below:
http://www.rns-pdf.londonstockexchange.com/rns/1512P_-2017-8-29.pdf
Introduction
SolGold is continuing to pursue its strategy to become a
globally important copper company by expanding the Company's
copper-gold exploration portfolio in Ecuador.
Additional tenements continue to be granted to SolGold's four
local subsidiary companies. These tenements cover the targets
previously identified in the study of potential prospective
porphyry centres throughout the northern Andean copper belt in
Ecuador.
Teams of Company geologists are on the ground throughout Ecuador
conducting initial baseline data collection and identifying
prospective targets for follow-up exploration.
Expanding SolGold's Ecuadorean ground position
Since the 30 May 2017 announcement that SolGold subsidiaries had
a total of 38 granted tenements, an additional 21 tenements have
been approved. This brings the total to 59 granted tenements for
2,496 km(2) , in addition to the Company's world class Cascabel
porphyry project.
Initial exploration results
Each of SolGold's four subsidiary companies has a team of
geologists on the ground carrying out reconnaissance field mapping
and rock chip sampling programs as well as evaluating several
outcropping mineralised targets. The teams are focussed on first
pass exploration on the Porvenir, San Antonio, Sharug, Machos,
Agustin and Rio Amarillo projects.
Initial mapping campaigns have been very encouraging with
widespread areas of hydrothermal alteration identified which are
considered highly prospective for porphyry and epithermal style
mineralisation.
Whilst many assay consignments are yet to be returned from the
laboratory, initial rock chip samples taken of altered outcrops
have returned values as high as 12% Cu.
Planned Work
Following on from the geological mapping and rock chip sampling,
the regional geology teams are commencing systematic stream
sediment sampling and panned concentrate programs over the
prospective tenements. From the stream and panned concentrate
results, gridded soil programs will be planned to identify targets
to be drilled in due course.
Several areas of hydrothermal alteration mapped were so
pervasive that the next stage of exploration will be straight to a
gridded soil survey.
Qualified Person:
Information in this report relating to the exploration results
is based on data reviewed by Mr Nicholas Mather (B.Sc. Hons Geol.),
the Chief Executive Officer of the Company. Mr Mather is a Fellow
of the Australasian Institute of Mining and Metallurgy who has in
excess of 25 years' experience in mineral exploration and is a
Qualified Person under the AIM Rules. Mr Mather consents to the
inclusion of the information in the form and context in which it
appears.
By order of the Board
Karl Schlobohm
Company Secretary
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 until the release of this
announcement.
CONTACTS
Mr Nicholas Mather Tel: +61 (0) 7 3303 0665
SolGold Plc (Executive Director) +61 (0) 417 880 448
nmather@solgold.com.au
Mr Karl Schlobohm Tel: +61 (0) 7 3303 0661
SolGold Plc (Company Secretary)
kschlobohm@solgold.com.au
Mr Ewan Leggat / Mr Richard Morrison Tel: +44 (0) 20 3470
0470
SP Angel Corporate Finance LLP (NOMAD and Broker)
ewan.leggat@spangel.co.uk
Follow us on twitter @SolGold_plc
NOTES TO EDITORS
SolGold is a Brisbane, Australia based, dual AIM and TSX--listed
(SOLG on both exchanges) copper gold exploration and future
development company with assets in Ecuador, Solomon Islands and
Australia. SolGold's primary objective is to discover and define
world--class copper--gold deposits. The Board and Management Team
have substantial vested interests in the success of the Company as
shareholders as well as strong track records in the areas of
exploration, mine appraisal and development, investment, finance
and law. SolGold's experience is augmented by state of the art
geophysical and modelling techniques and the guidance of porphyry
copper and gold expert Dr Steve Garwin.
SolGold was shortlisted as a nominee for the Mining Journal
Explorer Achievement Award for 2016. The Company announced USD54m
in capital raisings in September 2016 involving Maxit Capital LP,
Newcrest International Ltd and DGR Global Ltd, and a USD41.2m
raising in June of 2017 largely from Newcrest International with
USD1.2m raised from Ecuadorean investors. All of these raisings
were undertaken at substantial premiums to previous raisings, and
SolGold currently has circa USD65 million in available cash to
continue the exploration and development of its flagship Cascabel
Project.
Mr Craig Jones joined the SolGold Board on 3 March 2017,
nominated to the Board of SolGold by Newcrest Mining, now a 14.54%
shareholder in SolGold. Mr Jones is a Mechanical Engineer and is
currently the Executive General Manager Wafi-Golpu
(Newcrest-Harmony MMJV). He has held various senior management and
executive roles within the Newcrest Group, including General
Manager Projects, General Manager Cadia Valley Operations,
Executive General Manager Projects and Asset Management, Executive
General Manager Australian and Indonesian Operations, Executive
General Manager Australian Operations and Projects, and Executive
General Manager Cadia and Morobe Mining Joint Venture. Prior to
joining Newcrest, Mr Jones worked for Rio Tinto.
Cascabel, SolGold's 85% owned "World Class" (Refer Cautionary
Notice: www.solgold.com.au/cautionary-notice/) flagship
copper--gold porphyry project, is located in northern Ecuador on
the under--explored northern section of the richly endowed Andean
Copper Belt. SolGold owns 85% of Exploraciones Novomining S.A.
("ENSA") and approximately 8% of TSX--V--listed Cornerstone Capital
Resources ("Cornerstone"), which holds the remaining 15% of ENSA,
the Ecuadorian registered company which holds 100% of the Cascabel
concession. Subject to the terms of existing agreements,
Cornerstone is debt financed by SolGold for its share of costs to
completion of a Feasibility Study ("Financing Option"). In terms of
repayment, SolGold shall receive 90% of Cornerstone's distribution
of earnings or dividends from ENSA or the Tenement to which
Cornerstone would otherwise be entitled until such time as the
amounts so received equal the aggregate amount of expenditures
incurred by SolGold that, but for the Financing Option, would have
been payable by Cornerstone, plus interest thereon from the dates
such expenditures were incurred at a rate per annum equal to LIBOR
plus 2 per cent until such time as SolGold is fully reimbursed.
The investments by Newcrest for 14.54% of SolGold endorses
Ecuador as an exploration and mining destination, the management
team at SolGold, the dimension, size and scale of the growing
Alpala deposit, and the prospectivity of Cascabel and its multiple
targets. The gold endowment, location, infrastructure, logistics
are important competitive advantages offered by the project.
To date SolGold has completed geological mapping, soil sampling,
rock saw channel sampling, geochemical and spectral alteration
mapping over 25km(2) , along with an additional 9km(2) of Induced
Polarisation and 14km(2) Magnetotelluric "Orion" surveys over the
Alpala cluster and Aguinaga targets.
SolGold has completed over 44,500m of drilling and expended over
USD50M on the program, which includes corporate costs and
investments into Cornerstone. This has been accomplished with a
workforce of up to 176 Ecuadorean workers and geoscientists, and 6
expatriate Australian geoscientists. The results of 35 holes
drilled (including re-drilled holes) and assayed to date have
produced some of the greatest drill hole intercepts in porphyry
copper-gold exploration history, as indicated by Hole 12
(CSD-16-012) returning 1560m grading 0.59% copper and 0.54 g/t gold
including, 1044m grading 0.74% copper and 0.54 g/t gold.
The average grade of all metres drilled to date on the project
currently stands at 0.31% copper and 0.26 g/t gold. Intensive
diamond drilling is planned for the next 12 months with 10 drill
rigs expected to be operational by early 2018, targeting over
90,000m of drilling per annum.
Cascabel is characterised by fifteen (15) identified targets,
"World Class" drilling intersections over 1km in length at
potentially economic grades, and high copper and gold grades in
richer sections, as well as logistic advantages in location,
elevation, water supply, proximity to roads, port and power
services; and a progressive legislative approach to resource
development in Ecuador.
To date, SolGold has drill tested 4 of the 15 targets, being
Alpala Northwest, Alpala Central, Hematite Hill, and Alpala
Southeast. Currently drill testing of Alpala Northwest, Alpala
Central and Alpala Southeast targets is underway, with drill
testing of the other priority targets to be considered following
the publication of the Company's maiden resource estimate for
Alpala and the finalisation of further IP surveying and modelling
work currently underway.
The Alpala deposit is open in multiple directions and the
mineralised corridor marked for drill testing of the greater Alpala
cluster occurs over a 2.2km strike length from Trivinio in the
northwest to Cristal in the southeast. The mineralised corridor is
known to be prospective over approximately 700m width.
High priority targets within the Alpala cluster, at Moran
approximately 700m to the north, and at Aguinaga approximately
2.3km north east, are closely modelled by 3D MVI magnetic
signatures that currently encompass over 10Bt of magnetic rock.
Based on a strong spatial and genetic relationship between copper
sulphides and magnetite, this body of magnetic rock is considered
to be highly prospective for significant copper and gold
mineralisation, and requires drill testing.
SolGold is focussing on extending the dimensions of the Alpala
deposit including Alpala Northwest, Hematite Hill, Alpala South
East, Cristal, Trivinio, Alpala West, Carmen and Alpala South
before completing a resource estimate as well as drill testing of
the other key targets within the Cascabel concession at Aguinaga,
Tandayama-America, Alpala West, Carmen, Alpala East, Moran,
Parambas, and Chinambicito.
The Company is currently planning further metallurgical testing
and completion of an independent Pre-Feasibility Study at Cascabel.
SolGold is investigating both high tonnage open cut and underground
block caving operations, as well as a high grade / low tonnage
initial underground development towards the economic development of
the copper gold deposit/s at Cascabel.
Drill hole intercepts have been updated to reflect current
commodity prices, using a data aggregation method, defined by
copper equivalent cut-off grades and reported with up to 10m
internal dilution, excluding bridging to a single sample. Copper
equivalent grades are calculated using a gold conversion factor of
0.63, determined using an updated copper price of USD3.00/pound and
an updated gold price of USD1300/ounce. True widths of down hole
intersections are estimated to be approximately 25-50%.
Following a comprehensive review of the geology and
prospectivity of Ecuador, SolGold and its subsidiaries have also
applied for additional exploration licences in Ecuador over a
number of promising porphyry copper gold targets throughout the
Country. Over 50 such concessions have been granted and announced
to date. SolGold is negotiating external funding options which will
provide the Company with the ability to have some of these projects
fully funded by a third party while focussing on Cascabel.
In Queensland, Australia the Company is evaluating the future
exploration plans for the Mt Perry, Rannes and Normanby projects,
with drill testing of the Normanby project planned for the coming
quarter. Joint venture agreements are being investigated for a
joint venture partner to commit funds and carry out exploration to
earn an interest in the tenements.
SolGold retains interests in its original theatre of operations,
Solomon Islands in the South West Pacific, where the 100% owned,
but as yet undrilled, Kuma prospect on the island of Guadalcanal
exhibits surface lithocap characteristics which are traditionally
indicative of a large metal rich copper gold intrusive porphyry
system. SolGold intends in the future to apply intellectual
property and experience developed in Ecuador to target additional
"World Class" copper gold porphyries at Kuma and other targets in
Ecuador and Argentina.
SolGold is based in Brisbane, Queensland, Australia. The Company
listed on London's AIM Market in 2006, and dual-listed onto the TSX
in July 2017 (both exchanges using the ticker code: SOLG) and
currently has on issue a total of 1,516,245,686 fully-paid ordinary
shares, 31,795,884 share options exercisable at 28p; 9,795,884
share options exercisable at 14p and 46,762,000 share options
exercisable at 60p.
CAUTIONARY NOTICE
News releases, presentations and public commentary made by
SolGold plc (the "Company") and its Officers may contain certain
statements and expressions of belief, expectation or opinion which
are forward looking statements, and which relate, inter alia, to
interpretations of exploration results to date and the Company's
proposed strategy, plans and objectives or to the expectations or
intentions of the Company's Directors. Such forward-looking and
interpretative statements involve known and unknown risks,
uncertainties and other important factors beyond the control of the
Company that could cause the actual performance or achievements of
the Company to be materially different from such interpretations
and forward-looking statements. Accordingly, the reader should not
rely on any interpretations or forward-looking statements; and save
as required by the exchange rules of TSX and LSE-AIM and LSE for
companies or by applicable laws, the Company does not accept any
obligation to disseminate any updates or revisions to such
interpretations or forward-looking statements. The Company may
reinterpret results to date as the status of its assets and
projects changes with time expenditure, metals prices and other
affecting circumstances.
The Company and its officers do not endorse, or reject or
otherwise comment on the conclusions, interpretations or views
expressed in press articles or third-party analysis, and where
possible aims to circulate all available material on its
website.
The Company recognises that the term "World Class" is subjective
and for the purpose of the Company's projects the Company considers
the drilling results at the growing Alpala Porphyry Copper Gold
Deposit at its Cascabel Project to represent intersections of a
"World Class" deposit on the basis of comparisons with other
drilling intersections from "World Class" deposits tabulated in
Table 1, some of which have become, or are becoming, producing
mines and on the basis of available independent opinions which may
be referenced to define the term "World Class" (or "Tier 1").
The Company considers that "World Class" deposits are rare, very
large, long life, low cost, and are responsible for approximately
half of total global metals production. "World Class" deposits are
generally accepted as deposits of a size and quality that create
multiple expansion opportunities, and have or are likely to
demonstrate robust economics that ensure development irrespective
of position within the global commodity cycles, or whether or not
the deposit has been fully drilled out, or a feasibility study
completed.
Standards drawn from industry experts (1Singer and Menzie, 2010;
2Schodde, 2006; 3Schodde and Hronsky, 2006; 4Singer, 1995;
5Laznicka, 2010) have characterised "World Class" deposits at
prevailing commodity prices. The relevant criteria for "World
Class" deposits, adjusted to current long run commodity prices, are
considered to be those holding or likely to hold more than 5
million tonnes of copper and/or more than 6 million ounces of gold
with a modelled net present value of greater than USD 1
Billion.
The Company cautions that the Cascabel Project remains an early
exploration stage project at this time. Despite the relatively high
copper and gold grades over long intersections and broad areas, and
widespread surface mineralization discovered at the Cascabel
Project to date, much of which has still not yet been drill tested,
the Company has yet to prepare an initial mineral resource estimate
at the Cascabel Project and any development or mining potential for
the project remains speculative. There is inherent uncertainty
relating to any project at an exploration stage, prior to the
determination of a mineral resource estimate, preliminary economic
assessment, pre-feasibility study and/or feasibility study. There
is no certainty that future results will yield the results seen to
date or that the project will continue to be considered to contain
a "World Class" deposit. Accordingly, past exploration results may
not be predictive of future exploration results.
From the drilling results at the growing Alpala Porphyry Copper
Gold Deposit (only) within the Cascabel Project, the Company
considers the deposit to have significant resource potential and
the data gathered has provided the basis for the estimation of an
exploration target over the area drilled to date. Initial 3D
modelling and grade shell interpolants have outlined an approximate
exploration target at Alpala that ranges from 729Mt at 1.06% copper
equivalent, using a cut-off grade of 0.4% copper equivalent, to
969Mt at 0.92% copper equivalent, using a cut-off grade of 0.3%
copper equivalent. These estimates equate to an endowment of
between 7.7-8.9Mt of contained copper equivalent (Figure A).
Copper equivalent grades used are calculated using a gold
conversion factor of 0.63, determined using a copper price of USD
3.00/pound and a gold price of USD 1300/ounce. Drill hole
intercepts are calculated using a data aggregation method, defined
by copper equivalent cut-off grades and reported with up to 10m
internal dilution, excluding bridging to a single sample. True
widths of down hole intersections are estimated to be approximately
25-50%.
The Company cautions that the potential quantity and grade
ranges (exploration target) disclosed above for the Alpala Porphyry
Copper Gold Deposit within the Cascabel Project is conceptual in
nature, and there has been insufficient exploration to define a
mineral resource, and the Company is uncertain if further
exploration will result in the exploration target being delineated
within a mineral resource estimate.
On this basis, the reference to the Cascabel Project as "World
Class" (or "Tier 1") is considered to be appropriate. Examples of
global copper and gold discoveries since 2006 that are generally
considered to be "World Class" are summarised in Table 2.
References cited in the text:
1. Singer, D.A. and Menzie, W.D., 2010. Quantitative Mineral
Resource Assessments: An Integrated Approach. Oxford University
Press Inc.
2. Schodde, R., 2006. What do we mean by a world class deposit?
And why are they special. Presentation. AMEC Conference, Perth.
3. Schodde, R and Hronsky, J.M.A, 2006. The Role of World-Class
Mines in Wealth Creation. Special Publications of the Society of
Economic Geologists Volume 12.
4. Singer, D.A., 1995, World-class base and precious metal
deposits-a quantitative analysis: Economic Geology, v. 90, no.1, p.
88-104.
5. Laznicka, P., 2010. Giant Metallic Deposits: Future Sources
of Industrial Metal, Second Edition. Springer-Verlag
Heidelberg.
This information is provided by RNS
The company news service from the London Stock Exchange
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